Private donations can help attract leaders

    Last Thursday, a committee of the UC Regents sent a controversial budget proposal to the full board without a recommendation, a testament to the difficulty of the issue the budget addressed.

    The proposal suggests soliciting private donations to supplement the salaries of 42 top UC executives to bring them up to at least $350,000, an amount that only eight of the 42 currently bring home. Committee members commented in frustration that the idea was complex, difficult and ultimately uncomfortable.

    Adopting this proposal would mean significant change in the governance of the nation’s top public school system, but if top UC officials are correct, it’s a necessary one. Even if they aren’t telling the whole truth, it is worth it for us to consider that when it comes to leadership, we may very well get what we pay for.

    It’s hard for students to see this as a problem that needs attention at all, given our own problems in financing our educations, and considering that these executives are already making around or in excess of $350,000 a year. At the very least, the message that the regents are so concerned with giving bonuses to chancellors is an uninspiring one, while we are paying more than we bargained for to continue at the university at all. But we often forget that this university is at its heart a business, and the issue of paying top executives higher salaries is a business interaction, meant to improve the quality of leadership.

    A report commissioned by the committee found that salaries for the top UC executives are about 15 percent less than those of equivalent positions in the rest of the United States. Other public university systems in Virginia and Texas have already opted to mix private and public funds in paying their own executives.

    Moreover, UC President Robert C. Dynes has insisted that the private donations used to supplement salaries would be money that wouldn’t otherwise go to the UC system, because particular donors have approached him and expressed interest in helping bring “leaders” to campuses. Funding from the state of California continues to drop, making the money brought in through research and private donations even more important.

    As always, there are other groups who believe that their needs are more pressing. The chairman of the Academic Senate at UC Davis insisted that “our first priority for fundraising should be graduate student support.” Union officials have argued that the UC system should focus on improving the pay and benefits of university employees. A past president of the UC Faculty Academic Council emphasized that the faculty teaches and researches, and questioned why prominence should be given to senior management.

    But it is a mistake to assume that there must be better places to spend the money, or that top executives already have healthy salaries is reason enough to move on to other things. It’s difficult to keep good people in any position if they could be making more money for the same job elsewhere, and it’s especially vital to keep good people in these jobs.

    UCSD is being paid to do things for us, true, but it is also involved in competitions for hundreds of millions of dollars in research grants and is a major employer and a pivotal member of the San Diego economic and social community. Running such an entity is an extraordinarily difficult job, and business entities that cannot pay their executives competitive salaries will have serious trouble hiring the best candidates. These salary boosts may well be what are needed to make the University of California more competitive and more productive, which is what will eventually benefit us all.

    There are troubling indications that the pay deficit might not be so pressing. The same report that reported on UC salaries also estimated that UC health benefits are higher than the average by 10 percent and retirement medical benefits are about 63 percent higher. Salaries reported by the UC system do not include bonuses or expense accounts, and the IRS figures show that significant bonuses have already boosted the salary of one of the 42 executives well beyond $350,000. If private donations should fall short in a future year, what happens? Is it truly private money when public funds are spent on the fundraising?

    Meanwhile, it is indisputably true that the costs for students are rising, and for decades, the UC system has played a major role in bringing the best in education to lower-income students. Increasing tuition makes that a more difficult tradition to sustain.

    There is a serious question for the regents to consider: Can the private donations in question, or the effort put into soliciting the private donations, better improve the stature and productivity of the university if invested in the executives who run the system, or in the system itself? It doesn’t have to be a choice between one or the other, but for the moment, the difficulty of finding good leaders for universities suggests that recruiting and keeping these leaders is indeed a worthy goal. But as new facts come to light and new arguments are presented, that evaluation could change.

    The proposal will come up for a vote in November, and it’s encouraging to see many of the regents comment that it will be hotly debated. It needs to be. While many question the wisdom of changing such a long-standing policy, others worry that the state will use it as a reason to reduce funding for the university even more. Hopefully, the vote will be made based on what is best for the university, and student and faculty organizations should consider that what is best for the UC system may not necessarily be what looks fair on paper.

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